Sphingosine 1-phosphate (S1P) signaling in the treatment of multiple sclerosis (MS) has been highlighted by the efficacy of FTY720 (fingolimod), which upon phosphorylation can modulate S1P receptor activities. FTY720 has become the first oral treatment for relapsing MS that was approved by the FDA in September 2010. Phosphorylated FTY720 modulates four of the five known S1P receptors (S1P(1), S1P(3), S1P(4), and S1P(5)) at high affinity. Studies in human MS and its animal model, experimental autoimmune encephalomyelitis (EAE), have revealed that FTY720 exposure alters lymphocyte trafficking via sequestration of auto-aggressive lymphocytes within lymphoid organs, representing the current understanding of its mechanism of action. These effects primarily involve S1P(1), which is thought to attenuate inflammatory insults in the central nervous system (CNS). In addition, FTY720's actions may involve direct effects on S1P receptor-mediated signaling in CNS cells, based upon the known expression of S1P receptors in CNS cell types relevant to MS, access to the CNS through the blood-brain barrier (BBB), and in vitro studies. These data implicate lysophospholipid signaling--via S1P(1) and perhaps other lysophospholipid receptors--in therapeutic approaches to MS and potentially other diseases with immunological and/or neurological components.